Standard & Poor's Ratings Services said it raised its long-term rating to BBB-minus from BB-minus on California Municipal Finance Authority's series 2006A education revenue bonds, issued for the American Heritage Education Foundation (AHEF), on behalf of the Heritage K-8 Charter School, and Escondido Charter High School (all three composing Heritage Education).
The outlook is stable.
"The raised rating reflect our view of AHEF's recent receipt of a bondholder approved waiver for its fiscal 2011 financial covenant violation, the remedy of which under the indenture had been mandatory acceleration of the bonds," said Standard & Poor's credit analyst Robert Dobbins. "In addition to the waiver, the bondholders contemporaneously amended the indenture to remove acceleration as a default remedy for nonpayment covenant violations, which we believe eliminates future liquidity risk for similar occurrences."
The American Heritage Education Foundation is a California nonprofit public benefit corporation organized for the purpose of providing benefits to the educational programs and services at two schools in Escondido: the Escondido Charter High School and Heritage K-8 Charter School. Escondido Charter High School was founded in 1996 to establish a California public charter school and was incorporated in 2001. Escondido's original charter was approved by the Escondido Union High School District in 1996 and has been renewed three times; it is up for renewal again in April 2015. Each school prepares its own independent audit, as does the foundation.
